GREEN FINANCING IN THE FOOD PRODUCTION

LÁMFALUSI IBOLYA – HÁMORI JUDIT – RÓZSA ANDREA – VÖRÖS-ILLÉS IVETT

Keywords: Keywords: agriculture, food processing, green finance, sustainability JEL codes: E44, Q56, Q58

Teljes cikk

The implementation of the sustainability goals set by the European Union (EU) requires the mobilization of significant financial resources for the green transition. A multi-year legislative process has resulted in an EU regulatory framework that provides the necessary coherent structure, along which green lending began several years ago. In Hungary, green lending was already available before the introduction of the EU Taxonomy framework, thanks to the capital relief programme of the Hungarian National Bank (MNB). In our study, we provide an overview of the conceptual and legal background of green lending, and the evolution of its stock in the agri-food sector.
In agriculture and food processing, green lending is at the beginning of its growth phase. The share of bank financing related to environmental sustainability in the food processing sector was close to 1 per cent in 2024, and remained below that level in agriculture, falling short of the comparable figure of nearly 6 per cent of the national economy. This underperformance is mainly due to sector-specific factors, such as differences in farm structure or in the measurability of environmental sustainability, as well as to the Common Agricultural Policy (CAP) AP tenders determining agricultural lending and to the less favourable income situation in recent years. In addition, deteriorating macroeconomic conditions, the time needed to acquire the specific knowledge required for green lending, especially in the agricultural context, and the significant additional administrative burden related to sustainability are also important factors.
DOI: https://doi.org/10.53079/GAZDALKODAS.69.6.t.pp_484-500